Investors set blueprint from oil and gas transformation

A group of investors with £10tr AUM has set out a blueprint for oil and gas companies to achieve net-zero. The Oil and Gas Sector Net Zero Standard sets minimum expectation for what must be included in transition plans and is designed to be used across the oil and gas sector to standardise transition plans.

The publication of the standard follows a series of high-level dialogues between leading investors and major oil and gas companies, convened under the Institutional Investors Group on Climate Change (IIGCC) and informed by the Transition Pathway Initiative (TPI).

The standard details ten required standards and stresses need for comprehensive absolute and intensity emissions reduction targets, which cover all material emissions, as well as alignment of capital expenditure and production plans with a net-zero target. It acknowledges ‘winding-down’ as a legitimate strategy, as well as diversifying energy offerings or working through a company’s value chain to re-shape demand.

Adam Matthews, chair of the Investor-Company process to develop the standard and chief responsible investment officer, Church of England Pensions Board, commented: “In order for investors to play their role, we need to be able to meaningfully compare different company strategies whilst recognising that there is no one size fits all approach. Assessing the credibility and adequacy of company transition plans is a technically complex task.

Other investors that have backed he standard include Amundi, Legal & General Investment Management and HSBC Global Asset Management.

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